Personal finance Friday

Taurus MF floats Fixed Maturity Plan 120 Days Series 2; Taurus MF launches 91 Days FMP; IDFC Mutual Fund revises exit load under IDFC Nifty Fund

Taurus MF floats Fixed Maturity Plan 120 Days Series 2

Taurus Mutual Fund has launched Taurus Fixed Maturity Plan 120 Days Series 2, a close- ended income scheme.

The investment objective of the scheme is to generate income with minimum volatility through investments in a portfolio of debt and money market instruments maturing on or before the maturity of the scheme.

The new issue opens on 14th January and closes on 18th January. The minimum investment amount is Rs10,000. CRISIL Short Term Bond Fund Index is the benchmark index. The scheme would be managed by Pankaj Jain.

Taurus MF launches 91 Days FMP

Taurus Mutual Fund has launched Taurus Fixed Maturity Plan-Series A (91 Days), a close-ended debt scheme. The duration of the scheme is 91 days from the date of allotment of units.

The investment objective of the scheme is to generate income with minimum volatility through investments in debt and money market instruments maturing on or before the maturity of the scheme. The scheme offers growth and dividend option. The scheme would allocate 100% of assets in debt and money market instruments with low to medium risk profile. The new issue opens on 19th January and closes on 24th January.

The minimum investment amount is Rs5,000. The minimum target amount is Rs1 crore.

Entry and exit load charge for the scheme will be nil.
CRISIL Liquid Fund Index is the benchmark index. The fund manager for the scheme will be Rahul Plan and Pankaj Jain.

IDFC Mutual Fund revises exit load under IDFC Nifty Fund

IDFC Mutual Fund has declared the revision of exit load structure under IDFC Nifty Fund. As per the revised structure, the exit load for all investments including SIP/Micro SIP/STP shall be 1% if redeemed/switched out within seven days from the date of allotment. The revision will be in effect from 14th January.

IDFC Nifty Fund is an open-ended index linked scheme with the investment objective to replicate the S&P CNX Nifty Index by investing in securities of the S&P CNX Nifty Index in the same proportion/weightage. 

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Will India's gas dreams go up in smoke?

An industry journal reports that RIL has informed the Directorate General of Hydrocarbons it will not be able to ramp up gas production for KG DG beyond 50 mmscmd for another year at least. If this is true, it would be a setback for the country’s dreams of gas-powered growth

Indian Petro, an industry journal, claims that Reliance Industries has informed the Directorate General of Hydrocarbons that it will not be able to ramp up gas production from its KG-D6 block beyond 50 mmcmd (million metric cubic metres per day) until FY14, on account of serious reservoir (water) issues as well as water entering wells, sand interference and pressure depletion.

If this development is confirmed, it means not only lower earnings for Reliance Industries, but also for gas transmission companies such as Gujarat State Petronet and GAIL India.

In a report to its clients, Kotak Institutional Equities has said, "This development, if confirmed, poses significant downside risk to RIL's earnings; our FY12E and FY13E EPS for RIL will decline by `6 (-8.5%) and `11 (-13.8%), if gas production declines to 50 mcm/d, versus our current assumption of 70mcm/d in FY12E and 88mcm/d in FY13E."

Just a few days ago, press reports claimed that Reliance Industries will regain gas production of 60 million standard cubic metres a day from its KG-D6 block by April, as two more wells will now produce gas. The source for these reports was comments by S K Srivastava, director-general of the Directorate General of Hydrocarbons. He said RIL was operating 18 wells, but will move on to 22 wells by April, at which time the production will rise.

The larger issue, if RIL is unable to keep up with its earlier forecasts of gas production, is paucity of gas and a hold-up of projects that depend on a certain amount of gas output-mainly pipeline, power, and fertiliser projects. Gas transmission companies will be immediately hit with lower gas transmission volumes.

Click here to see Base-case gas supply graph

Kotak says its base-case scenario estimates that gas supply in India will ramp up to 335mcm/d by FY17 from 177mcm/d  in FY11. However, it sees significant downside risk to these estimates from lower-than-expected production from RIL's KG D-6 block and delay in production from RIL's NEC-25, KG D-3 and KG D-9 blocks to beyond FY17. Its worse-case scenario implies a modest increase of only 67mcm/d in gas supply by FY17.

While the impact will be negative for RIL, GAIL may get some respite as there's a very good chance that the gas regulator will revise the tariff for its new pipelines upwards, if volumes are low. This will cushion the impact somewhat. Additionally, as Kotak says, "We believe GAIL is in a better position versus Gujarat State Petronet (GSPL) regarding availability of gas, since two of its new pipelines (Dabhol-Bangalore and Kochi-Mangalore-Bangalore) will get gas from LNG import terminals at Dabhol and Kochi (Petronet LNG). GAIL will also have first priority for supply of gas, in our view, given it supplies to fertiliser and power plants, (which are) priority sectors as per the government's gas allocation policy."

GSPL is not so well off. GSPL's two new pipelines (Mallavaram-Vijapur-Bhilwara and Mehsana-Bhatinda with a total capacity of 96mcm/d) cannot be revised, even if volumes fall short of its base assumptions.

Petronet LNG will be the biggest beneficiary. An increase in spot LNG cargo due to lower domestic gas supply will improve its earnings. The only problem is the price-imported LNG will be expensive and not so easy to sell, particularly to the fertiliser and power sectors. Besides Petronet is still dealing with issues such as high inventory levels since it is already at full capacity. This will persist until its second jetty is commissioned.

(This article is based on secondary research. The report is for information only. None of the stock information, data and company information presented herein constitutes a recommendation or solicitation of any offer to buy or sell any securities. Investors must do their own research and due diligence before acting on any security. Some of the opinions expressed in this article are the author's own and may not necessarily represent those of Moneylife.)

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COMMENTS

kraju

6 years ago

what is market why ara you going

BS

6 years ago

It seems unlikely tht GSPL'S present grid will be affected much as D6 gas will be replaced by spot gas from two terminals in gujarat. And in gujarat gspl is better placed than gail to its connectivity to all industrial sectors. Though higher spot gas price may have to be seen...

citizenindia

6 years ago

there were reports that reliance isnt finding too many takers for its gas. hence they have to delay ramp up. cant rely on reliance. rpl mein paisa uthaya, share chali , treasury stock becha and wapas ril mein merge kar diya. jab share chalana ho to gas mil jaati hai, jab liquidity crunch ho to lic ko block de do.

tamilan

6 years ago

Before writing,be well informed.PLL is not having any problem of higher stock.

Rangarajan: Some monetary tightening required to tame inflation

New Delhi: The head of the Prime Minister's Economic Advisory Council today said he favours "some tightening" of money supply by the Reserve Bank of India (RBI) later this month, in case food prices do not come down.

"The inflation rate for December has turned out to be much higher than what was originally expected... Given the present situation, perhaps some tightening on the part of the Reserve Bank may be required," Dr C Rangarajan, chairman of the Prime Minister's Economic Advisory Council, told PTI.

The overall inflation for December, measured on the basis of wholesale prices, increased from 7.48 per cent in November to 8.43% in December.

"Unless there is some substantial decline in the food prices in the next two weeks, in my view, perhaps some tightening may be required," Dr Rangarajan said.  

The RBI is expected to announce a hike in key policy rates by 25-50 basis points at its quarterly monetary policy review meeting on 25th January. The apex bank raised policy rates six times last year, but has not changed rates since its review in November.

Food inflation has remained high through December, touching a one-year high of 18.32%. It eased somewhat to 16.91% for the week ended 1st January.

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